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In March 2019, THQ Nordic AB (publ) (STO:THQN B) released its earnings update. Generally, the consensus outlook from analysts appear fairly confident, with earnings expected to grow by 39% in the upcoming year, though this is comparatively lower than the previous 5-year average earnings growth of 46%. By 2020, we can expect THQ Nordic’s bottom line to reach kr410m, a jump from the current trailing-twelve-month of kr294m. I will provide a brief commentary around the figures and analyst expectations in the near term. Readers that are interested in understanding the company beyond these figures should research its fundamentals here.
See our latest analysis for THQ Nordic
How is THQ Nordic going to perform in the near future?
The longer term view from the 6 analysts covering THQN B is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
By 2022, THQN B's earnings should reach kr657m, from current levels of kr294m, resulting in an annual growth rate of 24%. This leads to an EPS of SEK5.96 in the final year of projections relative to the current EPS of SEK3.5. Margins are currently sitting at 6.6%, which is expected to expand to 13% by 2022.
Next Steps:
Future outlook is only one aspect when you're building an investment case for a stock. For THQ Nordic, I've put together three key aspects you should look at:
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Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
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Valuation: What is THQ Nordic worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether THQ Nordic is currently mispriced by the market.
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Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of THQ Nordic? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.